5 Basic Steps Of Bookkeeping For Roofing Contractors

Finances ensure your business runs smoothly and secure funds for long-term investments. Any financial choice affects a business in either a good or a bad way. These financial choices include bookkeeping. Bookkeeping for roofing contractors involves recording all financial transactions in your roofing business.

Bookkeepers are responsible for recording, classifying, and organizing your financial transactions. The following are the basic steps of bookkeeping that your bookkeeper follows.

1. Assigns Documents To Specific Accounts And  Analyzes Financial Transactions 

In this step, your bookkeeper organizes your original financial documents by retaining and filing them. Filing gets done for easy access and reference whenever needed. You should also analyze the documents for further clarification. These original financial documents include:

• Invoices

• Credit notes

• Debit notes

• Petty Cash vouchers

• Paying slips

• Bank statements etc.      

Remember to reprint these source documents to ensure no documents go unrecorded.

2. Writes Original Journal Entries

Your bookkeeper will then record all your financial entries under the appropriate credit or debit accounts in the original books of entry. This process can be done daily. These record books are:

• Cashbook

• Purchases book

• Sales book

• Petty Cash Book

• Sales returns book

3. Posts Entries To Ledger Accounts

Your ledger accounts are the main book of accounts. These accounts are where your roofing contractor bookkeeper will record all the debits and credits in the business operations. These types of ledgers include the general, debtors, and creditors ledgers.

4. Adjusts entries

Your bookkeeper does this step at the end of each accounting period. This move helps record any unrecognized income or expense for that particular period. At this point, your bookkeeper prepares a trial balance, adding the debit and credit column and comparing the two additions. If you are looking for profits, then the credits must be greater than the debits.

5. Brings The Books To A Close

In this step, your bookkeeper closes the fiscal year and starts preparing for the next bookkeeping period. They keep your financial records up to date and start the preparation for the next period.

Conclusion

Bookkeeping for roofing contractors is very important in your accounting process. The process generates accurate financial records and reports that help you measure the performance of your roofing business. Proper bookkeeping can bring your business to success. After reading this information, you may want to consider hiring a professional bookkeeper for your roofing business to ensure that you maintain a smooth bookkeeping process.